Concerns Over Tight Demand Drove the Most-Traded BC Copper Contract Up 1.54% [SMM BC Copper Commentary]

Today, the most-traded BC copper contract 2605 opened at 88,680 yuan/mt, dipping to a low of 88,380 yuan/mt at the start of the session before the center shifted upward to a high of 90,100 yuan/mt. Copper prices then stayed high and moved sideways, ultimately closing at 89,870 yuan/mt, up 1.54%. Open interest stood at 6,466 lots, a decrease of 49 lots from the previous trading day, while trading volume reached 5,015 lots, an increase of 1,136 lots from the previous trading day. On the macro front, Trump stated that Iran had initiated contact, hoping to push for a relevant agreement, while the U.S. maintained its stance against Iran possessing nuclear weapons. Both sides are still in communication, and the next round of negotiations may be held in Islamabad in the near term, with the possibility of a ceasefire extension. Israel's Prime Minister suggested that the ceasefire may be difficult to sustain and expressed support for the U.S. naval blockade measures. U.S. officials said that significant progress had been made in negotiations, and the advancement of subsequent talks would depend on Iran's attitude. The market held optimistic expectations for the negotiation process, which, combined with tight supply and resilient demand, provided some bullish support for copper prices. Fundamentals side, supply side, imported sources arrived steadily while domestic sources saw fewer arrivals; demand side, the support for consumption weakened somewhat due to rising copper prices.

The SHFE copper 2605 contract closed at 101,190 yuan/mt. Based on the BC copper 2605 contract price of 89,870 yuan/mt, the after-tax price was 101,553 yuan/mt. The price spread between the SHFE copper 2605 contract and BC copper was -363 yuan/mt, showing an inverted spread that narrowed compared to the previous day.